Proposed Amendments to Impairment Guidelines & Title 12 of the New York Codes Rules and Regulations

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Recently, the New York Workers’ Compensation Board (Board) submitted a proposal for amending the current schedule loss of use (SLU) Guidelines, as well as Title 12 of the New York Codes Rules and Regulations. This proposal has not achieved the status of law; it is simply the Board’s first attempt to update the 1996 SLU Guidelines and acts as starting place for all stakeholders to submit their thoughts and comments to the Board for consideration.  The legislative mandate, however, is to have the new Guidelines effective by January 1, 2018.

Since the proposal, multiple law firms and entities have sent out memorandums, each giving their own point of view on the proposed amendments. Unfortunately, some of these memorandums are misleading at best and have caused significant confusion throughout the industry. In an effort to provide our clients with information they can utilize to asses the true impact of the proposed changes, we have created this informational guide.  Please keep in mind that since the Proposed Guidelines give the Workers’ Compensation Law Judge’s unprecedented authority to modify the ultimate SLU award we all must consider that their impact will to some extent remain an unknown until the Guidelines are put into practice.

History

In June of 1996, the Board published Impairment Guidelines in an effort to provide uniform guidelines for the medical evaluation of SLU impairments. These Guidelines are commonly known as “The 1996 Guidelines”, and they have remained essentially unchanged until this recent Board proposal. In 2007, New York State decided to create Workers’ Compensation reform legislation. The primary focus of this reform legislation was to implement  non-schedule permanent partial disability awards based on a claimant’s disability and their “loss of wage earning capacity”. For the first time in the history of New York Workers’ Compensation Law the legislature saw fit to view Workers’ Compensation disability as a component of not only physical disability, but also loss of the ability to work based upon social factors.

It was during this period of change that the Governor’s Office appointed our firm to help make this reform legislation a reality. During the process of creating new rules and regulations focusing on this new definition of disability and limiting the duration of permanent partial disabilities (PPD) we hoped to also address the outdated 1996 SLU Guidelines. Unfortunately, the Department of Insurance was not ready to take on such an undertaking and it is our opinion that their failure to act has caused much of today’s angst with the current New York Workers’ Compensation system.  Since we were successful in limiting the duration and amount of PPD awards, the claimant’s bar changed their focus to exploit the outdated 1996 SLU Guidelines in order to manufacture large SLU awards and fees.  With this concern in mind the Board has now proposed new SLU legislation.  So the first point we must keep in mind is that new SLU Guidelines are an attempt to reduce SLU awards by being “reflective of advances in modern medicine that enhance healing and result in better outcomes” [WCL 15(3)(x)].

 Proposed Permanency Impairment Guidelines

Under the newly proposed Permanency Impairment Guidelines, the final value of SLU award will be a factual determination made by the Law Judges based on: (1) medical evidence of permanent residual physical deficit which is consistent with these Guidelines, and (2) the impact on the claimant’s earning power.

Real World Consequences: In the past, the claimant’s actual earning power played no role in the SLU award, but rather the award was given for the residual permanent physical and functional impairments only. Just as the 2007 Reform Act changed the PPD definition of disability to include social factors that affect a claimant’s ability to work, the new SLU guidelines also now address social factors that impact the claimant’s earning power.

The Proposed Guidelines go out of their way to state that the SLU “impact on earning power” is not the same as the PPD “loss of wage earning capacity,” or “wage earning capacity”. To ensure that the SLU award appropriately considers the claimant’s loss of earning power, the Board has given the Workers’ Compensation Law Judges the discretion to add an additional value of up to 15% to the impairment finding, not to exceed 100% of the affected body part, to reach the final SLU award.

Real World Consequences: The Board has not specifically indicated the factors that the Judge will consider when adding additional loss of earning power values; however, the new SLU-1 form will give a good indication of the criteria that will be considered. One thing that that is clear; the Law Judge will have significant latitude to affect the final SLU award by adding up to 15 loss of earning power points.

The medical provider input, although quite different from the Law Judge’s input, will nonetheless significantly affect the ultimate SLU award. About half of the value of a SLU will be determined by the medical providers. The opinions of the Independent Medical Examiner and the treating physician, however, are considered more or less recommendations that a Law Judge can accept, reject or modify.

Proposed Changes to Title 12 of the New York Codes Rules and Regulations

Under the new Proposed Rules and Regulations, a claimant or claimant’s representative may not request an Independent Medical Examination except when directed by the Board upon demonstration that the treating provider is unwilling or unable to provide the SLU evaluation and opinion.

Real World Consequences: This will significantly limit the potential of doctor shopping, an extremely prevalent process used by the claimant’s bar. Additionally, this will limit the cases where a claimant is directed to a brand new doctor and the doctor provides a significantly high SLU opinion based on one range of motion examination of the claimant.

In addition, the Regulation changes make it clear that the claimant must now complete a form “SLU-1”, with a portion of the form being completed by the medical provider with respect to the claimant’s restrictions. The “SLU-1” is intended to show the impact of the injury upon claimant’s earning power, including medical restrictions and wage and work-schedule information. Medical restrictions noted must refer to documents in the claims file. The SLU-1 form is affirmative evidence proffered by the claimant, and the claimant’s attorney may not seek to produce the claimant as a witness in lieu of, or to bolster, the SLU-1 form.

Real World Consequences: The claimant cannot introduce restrictions that are not indicated on the SLU-1 and the doctor cannot indicate new restrictions on the SLU-1 that were not already on the claimant’s medical reports. Presumably, this means that if the doctors do not properly fill out the claimant’s medical forms, this will have a direct impact on the claimant’s potential award.

Further, the Proposed Rules and Regulations now state that a claimant must cooperate with the Independent Medical Examiner at all times during the Independent Medical Examination. The claimant must accurately and truthfully complete any questionnaire or intake sheets provided by the Independent Medical Examiner and answer any questions asked by the Independent Medical Examiner during the examination. The Board can suspend the claimant’s benefits if they find that the claimant has refused to submit to an Independent Medical Examination and may also decline to issue a SLU award upon a finding that the claimant failed to cooperate with a medical examination, including failure to accurately complete the SLU-1 form.

Real World Consequences: In the past, claimants have refused to fill out questionnaires or their attorney’s have told them not to. Under the new regulations, not only must the claimant fill out these questionnaires, if he or she fail to do so, the Board may draw a negative inference due to the claimant’s failure to complete the questionnaire or intake form.

A Real Time Example of the SLU Process

 Under the new Guidelines, medical providers must comment on the following elements:

  1. Whether claimant is at maximum medical improvement (MMI) (same as old Guidelines).
  2. Whether the claimant’s injury is permanent, and amenable to schedule (same as old Guidelines).
  3. Identification  of  the  injury(ies)  in  terms  of  severity  or  category  as  appropriate.
  4. For  each  injury,  unless  a  special  condition  exists,  the  applicable  category of injury is selected. The medical provider then measures the permanent residual physical deficit with respect to: (1) range of motion, (2) strength, and (3) pain.

 The Process

First, the treating physician and the Independent Medical Examiner must agree or the Law Judge must rule that the claimant injury has reached MMI.  Second, the treating physician and the Independent Medical Examiner must agree or the Law Judge must rule that the claimant’s injury is amenable to a SLU finding.

Assuming that MMI has been found and that the claimant’s injury is amenable to a SLU award, the medical providers will first place the claimant’s injury into one of three categories (Category A, Category B, and Category C).  The category is chosen based on the permanent residual physical deficit that has or is expected to occur based on the severity of the injury. Each category has a minimum and maximum impairment percentage [e.g., Category A (0-30%),  Category  B  (30-60%),  Category  C  (60-90%).

Real World Consequences: The lowest percentage impairment identified in the Categorization of Injuries Table for each member body part is now the starting point. As such, you simply look at the injury in question (i.e. diagnosis), find the specific Category A, B or C and then start with the lowest possible value in the category and add points from there.

Let us assume that the claimant Bobby Grey while working in New York sustained a compensable injury to his right hip that eventually resulted in a right total hip replacement. Further assume that the claimant’s right total hip replacement surgery was a success with a very good outcome.

Table 6.2 Categorization of Residual Impairment

Categorization of Residual Impairment: Hip and Femur

Category A

Category B

Category C

 •Greater trochanteric bursitis•Labral tear•Hamstring avulsion / tear•Gluteus medius tear•Bursitis•Hip replacement with very good outcome  •Labral tear (significant two quadrant labral tear)•Post traumatic arthritis or avascular necrosis•Moderate fracture (Femoral neck, nondisplaced intertrochanteric)•Moderate fracture (Spiral, oblique and/or transverse fractures of the femoral shaft without comminution)•Hip replacement with good/fair outcome • Complex fracture (displaced or comminuted intertrochanteric fractures, subtrochanteric fractures, femoral shaft fractures with comminution)• Post traumatic arthritis or avascular necrosis (requiring joint replacement)•Traumatic dislocation with recurring instability•Hip replacement with poor outcome
0-30% Impairment 30-60% Impairment 60-90% Impairment

Under Table 6.2 the claimant would fall under Category A which is equivalent to a 0-30% impairment rating. The provider, therefore, would start his analysis by giving the base impairment which would be a 0% impairment rating for Category A.

Next, the provider would consider the hip range of motion.  Each range of motion measurement should be repeated three times and the three values for each motion should be within 10 degrees of each other. The highest measurement of the three values is the one recorded. If the three measurements are not within 10 degrees of each other, the highest value will still be used for rating purposes but the values are to be reported as inconsistent.

The hip range of motion findings are displayed in three Tables, Flexion Table 6.3(a), Abduction Table 6.3(b) and Adduction Table 6.3(c). Each Table displays a number value in points representing each category of range of motion findings. The medical provider must choose the category and the equivalent points that correspond with their examination of the claimant range of motion. Under the regulation the range of motion analysis can not exceed 5 points.

Table 6.3(a) – Flexion

 

Hip Flexion Range of Motion

Points

Normal

120°-90°

0

Minor Loss

89°-45°

1

Moderate Loss

44°-25°

2

Significant Loss

< 23°

3

 

Table 6.3(b) – Abduction

 

Hip Abduction Range of Motion

Points

Normal < 10° loss compared to contralateral hip or > 40°

0

Significant Loss < 30° loss compared to contralateral hip or < 20°

1

 

Table 6.3(C) – Adduction

 

Hip Abduction Range of Motion

Points

Normal < 10° loss compared to contralateral hip or > 20°

0

Significant Loss < 20° loss compared to contralateral hip or < 0°

1

Let us assume for the purposes of our example that the medical provider finds a moderate loss of flexion (2 points), significant loss of hip abduction (1 point), and significant loss of hip adduction (1 point) for a total of 4 points.

Next, the medical provider considers the claimant hip strength. Muscle strength is assessed on a five-grade / five-point scale. Muscle strength should be determined based on examination of the global muscle strength and loss in any plane of motion can be used to determine the overall muscle strength impairment modification. Weakness with any range of motion is assigned points based on the scale below with a maximum score of five points. Muscle strength was not something that was independently assessed under the original 1996 SLU Guidelines.

Table 6.4 Hip Strength

Grade

Strength Rating

Points

5

Active movement against gravity with full resistance (normal strength, no deficit)

0

4

Active movement against gravity with some resistance (mild weakness)

1

3

Active movement against gravity without resistance (significant weakness, able to overcome gravity)

2

2

Active movement with gravity eliminated (significant weakness, unable to overcome gravity

3

1

Slight contraction and no active movement (muscle twitch only)

4

0

No contractions (paralysis, no muscle twitch)

5

Let us assume for the purposes of our example that the medical provider after examination finds that the claimant falls under Grade 3, “active movement against gravity without resistance”  (2 points). When combining the range of motion points (4) with muscle strength points (2) the claimant now has (6) points.

Next, the medical provider considers the claimant’s pain. Points for pain should only be given for persistent pain that is not likely to improve with time or further treatment. The medical provider should take care to consider historical reports of pain throughout the course of treatment. Pain is rated on a maximum scale of (5) points as indicated below. Pain is another category that was not independently evaluated under the 1996 Guidelines.

 

Table 6.5 Hip Pain

Pain Rating

Points

No pain or pain does not influence ability to perform job.

0

Pain that occasionally influences ability to perform job

1

Pain that requires modification of job functions; but allows task specific work to be accomplished.

2

Pain that intermittently prevents the injured worker from performing the essentials of the job – the type of work that the injured worker was engaged in at the time of the accident.

3

Pain that consistently prevents one from performing the essentials of the job – the type of work that the injured worker was engaged in at the time of the accident

4

Pain that prevents the injured worker from engaging in meaningful work, leisure or household duties

5

(Note: The new Guidelines also permit consideration for loss of sensation for peripheral nerve injuries and compression neuropathies.)

Let us assume for the purposes of our example that the medical provider after examination finds that the claimant’s pain is “pain that requires modification of job functions; but allows task specific work to be accomplished” (2 points). When combining the range of motion points (4) with muscle strength points (2) and the pain points (2) the claimant now has (8) points.

Assuming that the Law Judge accepts this medical provider recommendation, the Law Judge would then add loss of earing power points. If the claimant was an attorney,  one would expect that the loss of earning power points would be minimal. On the other hand, if the claimant was a construction worker, the loss of earning power points could be significant.  Assuming that our claimant was a construction worker the Law Judge could award an additional 15 (the maximum number) points which would give this claimant (8) points from the medical provider and (15) points from the Judge for a total SLU of 23% of the right leg (hip).

Now, how does this new proposed SLU process differ from the original 1996 SLU Guidelines? Well, this same claimant would have first received a 50% SLU award for simply receiving a hip replacement and then the claimant would have received additional points based upon the hip range of motion findings noted above. These additional mobility defects would increase the claimant’s SLU award to 66 2/3% under the original SLU Guidelines even though the original SLU Guidelines did not include strength points and pain points. The difference between a 66 2/3% SLU award and a 23% SLU award is very significant. Basically, this same injury under the original Guidelines would generate a SLU finding that is three times the SLU award that would be generated by the new Proposed SLU Guidelines.

Conclusion

The above example is very close to a real life fact pattern. Here you see the Board’s attempt to use advances in medicine to limit some of the outrageous SLU determinations that were part of the 1996 Guidelines. We believe it is fair to say that from a medical perspective we will see decreased SLU determinations when utilizing the new Guidelines. It should be noted, however, that the additional 15 points for loss of earning power will offset some of the benefits of the new Guidelines if your work force is primarily laborers. We must take into account that the impact of the additional earning power points is still largely unknown as no process has been published by the Board to date.

We would like to take this opportunity to make it clear that we do not join our brethren in the belief that these Guidelines are the death knell of SLU findings (see New York Workers’ Compensation Alliance White Paper) or that the new Guidelines will decimate the construction industry. Overall, the new Guidelines will reduce the SLU exposure for all stakeholders in the New York Workers’ Compensation system.

We look forward to hearing your comments on the new Guidelines as linked to within this informational guide. The Workers’ Compensation Board is expecting our response to these Proposed Guidelines. We would enjoy hearing from you so we can present a united front when addressing the Board.

We are prepared to work with you in navigating this new landscape. Our attorneys are experienced and excited about helping you understand how these proposed changes could affect your claims management program. Please contact us at clientservices@jonesjonesllc.com should you wish to discuss further.

Sincerely,

William S. Jones

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